[Click eStock] Samsung Electronics, 3Q Revenue Expected to be the Highest

[Asia Economy Reporter Hwang Junho] Eugene Investment & Securities maintained its investment opinion (buy) and target price (KRW 100,000 per share) for Samsung Electronics, stating that among global mega-cap companies with a market capitalization exceeding $300 billion, Samsung Electronics is the stock with the least price increase.

Eugene Investment & Securities expects Samsung Electronics' Q3 earnings to surpass market expectations, with sales of KRW 74.2 trillion and operating profit of KRW 16 trillion. Sales are projected to break the KRW 70 trillion barrier for the first time ever, and operating profit is expected to be the second highest on record, following KRW 17.6 trillion in Q3 2018.

However, the better-than-expected earnings are considered a kind of basic option for Samsung Electronics. Good earnings alone are not a sufficient condition for stock price increases. For the stock price to rise, strategic changes and M&A activities need to be supported, or the stability of DRAM spot prices is necessary, the analysis stated.

Researcher Lee Seung-woo of Eugene Investment & Securities explained, "Recently, the decline in DRAM spot prices has somewhat slowed, and even the DRAM Index (DXI) has slightly rebounded. Considering that the weakness in DRAM prices has already been reflected in the stock price, Samsung Electronics can be seen as the most undervalued and least appreciated stock among global mega-cap companies with a market capitalization exceeding $300 billion."